investor advocates

Investor Alert: Iorio Altamirano LLP Investigates Robinhood, T.D. Ameritrade, Charles Schwab, and Other Brokerage Firms for Market Manipulation

Published on: January 28, 2021 | by Iorio Altamirano

Iorio Altamirano LLP is investigating claims of market manipulation and breach of contract after Robinhood Markets, T.D. Ameritrade, Charles Schwab, and other brokerage firms halted the ability of its clients to purchase GameStop ($GME), AMC ($AMC), Blackberry ($BB), and Nokia ($NOK) stock.

To read our most recent blog post on this investigation, please click here.

The Financial Industry Regulatory Authority, which regulates brokerage firms like Robinhood, T.D. Ameritrade, and Charles Schwab, requires that broker-dealers make every effort to execute a marketable customer order that it receives fully and promptly.

Iorio Altamirano LLP Joins Congresswoman Maxine Waters in Urging the Biden Administration to Rescind Regulation Best Interest (Reg BI) and Replace it with a Uniform Fiduciary Obligation Standard.

Published on: January 20, 2021 | by Iorio Altamirano

As Joe Biden takes his place as the 46th President of the United States of America, House Financial Services Committee Chairwoman Maxine Waters, D-Calif., urges the Biden Administration to rescind Regulation Best Interest (Reg BI).

In a letter dated December 4, 2020, Rep. Waters outlined dozens of Trump-era regulations promulgated during the Trump administration that should be rescinded or replaced by the new administration.

Regulation Best Interest (Reg BI), which went into effect on June 30, 2020, establishes a standard of conduct for broker-dealers and brokers when they make a recommendation to a retail customer of any securities transaction or investment strategy involving securities. When a broker-dealer makes an investment recommendation, the investor is entitled to a recommendation that is in the investor’s best interest and does not place the interest of the financial professional or financial institution ahead of the retail investors’ interests.

New Year’s Resolutions for Investors in 2021

Published on: December 31, 2020 | by Iorio Altamirano

Investing your money is a great way to grow your wealth, save for retirement, and reach your financial goals. If you invest in the appropriate products, you can also receive income from investments, build on-pre-tax dollars, or reduce taxable income.

If you do not invest, you miss out on opportunities to increase your wealth. However, all investments carry risk, and when you invest, you have the potential to lose money.

There are many different types of investments. Some common types of investments include stocks, bonds, certificates of deposit, mutual funds, money market funds, exchange-traded funds, and annuities. There are also more complex investment vehicles, such as real estate investment trusts (REITs), unit investment trusts (UITs), hedge funds, commodities, and private placements.

Top 15 Types of Securities Leading to Customer Disputes in 2020

Published on: December 27, 2020 | by Iorio Altamirano

When an investor suffers harm, including investment losses, due to misconduct by a financial advisor or broker-dealer, the investor can file a securities arbitration claim against their financial advisor and/or broker-dealer in an effort to be compensated. The case will be presented and defended in an arbitration proceeding to a panel of arbitrators instead of a court of law in front of a judge and jury.

Arbitration is the primary forum for resolving disputes between investors and brokerage firms or financial advisors because the parties have contractually agreed to use arbitration as an alternative dispute resolution process. When an investor opens an account with a broker-dealer, the investor is required to sign an array of account opening documents. These account opening documents regularly include an arbitration clause, which requires that arbitration be used as an alternative to litigation. This requirement is often a contractually binding obligation for both parties. As a result, disputes between investors and financial advisors or brokerage firms are resolved in arbitration as an alternative to court.

The Financial Industry Regulatory Authority (FINRA) is authorized by Congress to regulate the financial services industry and operates the largest arbitration forum for securities disputes. Most securities arbitrations take place using FINRA’s Dispute Resolution Services’ arbitration forum because, as FINRA members, financial advisors and brokerage firms are required to arbitrate customer complaints upon the filing of a claim through FINRA.

UBS Ordered to Pay $90,000 to Yield Enhancement Strategy Customer

Published on: December 23, 2020 | by Iorio Altamirano

On December 22, 2020, a FINRA Dispute Resolution Services arbitration panel in Boca Raton, Florida, ordered UBS Financial Services, Inc. to pay a customer $89,675 in compensatory damages. After considering the pleadings, the testimony and evidence presented at the hearing, the arbitration panel concluded that the UBS Yield Enhancement Strategy (“YES”) was not suitable for the investor, Gerald S. Backman, a retired partner at corporate law firm Weil Gotshal & Manges.

Many UBS customers, including wealthy and sophisticated investors, who invested in UBS’s Yield Enhancement Strategy have filed lawsuits against UBS in the form of FINRA arbitrations to recover financial losses. The customers have claimed that the strategy was not suitable for them and that UBS materially misrepresented and omitted the product’s risks.

Investors who have suffered investment losses due to UBS’s Yield Enhancement Strategy should contact experienced securities arbitration attorneys at Iorio Altamirano LLP for a free and confidential case evaluation. Partner August Iorio, who has been investigating YES for nearly two years, can be reached at august@ia-law.com or toll-free at (855) 430-4010.

Transamerica Financial Advisors, Inc. Sanctioned by FINRA and Ordered to Pay $8.8 Million for Supervisory Violations Related to Variable Annuities, Mutual Funds, and 529 Plans

Published on: December 21, 2020 | by Iorio Altamirano

FINRA has sanctioned Transamerica Financial Advisors, Inc. (“Transamerica Financial”) for its failure to reasonably supervise its financial advisors’ recommendations of three different products – variable annuities, mutual funds, and 529 plans. These recommendations resulted in significant customer harm and financial loss. Transamerica Financial was ordered to pay $4.4 million in restitution to approximately 2,400 affected customers and also fined an additional $4.4 million.

Investors who have received partial restitution from Transamerica Financial through FINRA’s order may still be entitled to additional recovery. A FINRA partial restitution order does not preclude investors from pursuing their own claims to seek restitution or other available remedies.

If you have lost money with Transamerica Financial Advisors, Inc., contact New York securities arbitration attorney August Iorio of Iorio Altamirano LLP. Iorio Altamirano LLP represents investors with disputes with their financial advisors or brokerage firms, such as Transamerica Financial Advisors, Inc.

R.F. Lafferty & Co., Inc. and Financial Advisor Jay Clint Tomlinson Sanctioned by FINRA – New York, NY

Published on: December 15, 2020 | by Iorio Altamirano

FINRA has suspended financial advisor Jay Clint Tomlinson from the securities industry for three months and fined him $7,500. Mr. Tomlinson’s sanctions arise from his improper use of discretion without written authorization when placing 379 trades in three customers’ accounts.

FINRA has also censured Tomlinson’s employer, New York financial services firm R.F. Lafferty & Co., Inc., and ordered the firm to pay a fine of $55,000. R.F. Lafferty & Co., Inc. (“R.F. Lafferty”) failed to maintain order memoranda that accurately reflected whether trades were solicited or unsolicited for more than 56,000 trades in customer accounts. R.F. Lafferty also failed to establish and maintain a supervisory system, and failed to enforce written supervisory procedures, reasonably designed to achieve compliance with applicable recordkeeping laws, regulations, and rules pertaining to review and retention of order memoranda.

This is not the first time Mr. Tomlinson and R.F. Lafferty have been sanctioned by FINRA. In November 2012, Mr. Tomlinson was suspended for 30 days and fined $7,500 for failing to timely provide documents and information to FINRA. At the time, Mr. Tomlinson was the Chief Compliance Officer at Brimberg & Co. Brimberg & Co. was expelled from the securities industry by FINRA for failing to pay its monetary fines.

Former Cadaret, Grant & Co., Inc. Financial Advisor Timothy James Pandekakes Suspended for Unsuitable Variable Annuity Recommendations – Westchester, New York

Published on: December 10, 2020 | by Iorio Altamirano

FINRA has suspended financial advisor Timothy James Pandekakes (CRD No. 4890164) from the securities industry for three months and ordered him to pay partial restitution of $20,000.

FINRA alleged that between January 2016 and April 2018, while employed by Cadaret, Grant & Co., Inc. in Bronxville, New York, Mr. Pandekakes recommended four unsuitable exchanges of variable annuities, in violation of FINRA Rules 2111, 2330, and 2010.

Timothy Pandekakes was a financial advisor at Cadaret, Grant & Co., Inc. from December 2004 through June 2019. During the same period, he was also affiliated with MDIC Investment Company in Bronxville, New York. According to public records, Mr. Pandekakes’ employment was terminated by Cadaret, Grant & Co., Inc. in June 2019 for engaging in investment practices inconsistent with firm expectations.

Michael Edward Magill BARRED by FINRA – Portland, Maine

Published on: December 8, 2020 | by Iorio Altamirano

FINRA has barred financial advisor Michael Edward Magill (CRD #2024663) from the securities industry. Michael Magill was a stockbroker at Foreside Fund Services, LLC, in Portland, Maine, from August 2017 until January 2019.

If you have lost money with Michael Magill, contact New York securities arbitration lawyers Iorio Altamirano LLP for a free and confidential evaluation of your account.

Mr. Magill has been a financial advisor and registered representative at the following firms:

Registration Dates	Firm Name	Branch Location
August 2017 – January 2019	Foreside Fund Services, LLC	Portland, Maine
August 2016 – July 2017	Crossroads Capital Distributors, LLC	Newport Beach, California
December 2004 – December 2015	Janus Distributors LLC	Denver, Colorado
January 2000 – January 2005	Davis Distributors, LLC	Tucson, Arizona
January 1996 – January 1997	TCC Securities Corporation	San Francisco, California
July 1995 – January 1996	Phoenix Securities, Inc.	San Rafael, California
June 1994 – November 1994	Continental Capital Group, Inc.
May 1991 – November 1992	John Hancock Distributors, Inc.	Boston, Massachusetts
May 1991 – November 1992	John Hancock Mutual Life Insurance Company	Boston, Massachusetts
January 1990 – July 1990	*Hibbard Brown & Co., Inc.	New York, New York

*FINRA expelled Hibbard Brown & Co., Inc. on February 22, 1996

Michael Magill and FINRA entered into a Letter of Acceptance, Waiver, and Consent (“AWC”) on December 7, 2020, over allegations related to Magill recommending private securities transactions to three investors. The securities sold to the investors were not legitimate investments and the three investors, who were not customers of Foreside Fund Services, LLC, lost their entire investment, totaling $700,000. Specifically, FINRA alleged:

On December 3, 2018, while registered with Foreside Fund Services, LLC, Mr. Magill began working on behalf of a private issuer to find potential investors for a principal-protected note offered by the issuer.
Magill contacted prospective investors, provided them with marketing materials, explained the investment and terms of the note, and directed them to the issuer’s website to complete the paperwork necessary to make the investment.
In December 2018, Mr. Magill recommended the principal-protected note to three investors, who invested a total of $7000,000.
The first investor was 78 years old at the time of the investment and invested $100,000.
A second investor invested $250,000, and a third investor invested $100,000.
The investors were not customers of Foreside Fund Services, LLC.
To entice the prospective investors, Mr. Magill offered higher interest rates for immediate investments and told the investors that the investment was only available for a short time.
Magill earned $14,000 in commissions, a bonus for securing investments by the end of 2018, and the salary the private issuer paid him.
Before recommending the principal-protected note, Mr. Magill failed to conduct reasonable diligence to understand the features and risks of investing in the note.
In February 2019, federal authorities shut down the private issuer’s offices.
An executive of the private issuers and Mr. Magill’s supervisor at the private issuer both pled guilty to conspiracy to commit wire fraud and sentenced to prison. Another executive died in custody while awaiting trial.
Foreside Fund Services, LLC required its financial advisors to receive the firm’s written approval prior to participating in the transaction.
Magill did not provide written notice to Foreside Fund Services, LLC and received no written approval to participate in the three private securities transactions.

When a financial advisor solicits a customer to participate in a securities transaction that is not offered or approved by the advisor’s employing brokerage firm, it is often referred to as selling away.

This blog has previously written about other recent selling away allegations: Future Income Payments, LLC.

Brokerage firms like Foreside Fund Services, LLC must properly supervise financial advisors and customer accounts. Brokerage firms must also establish and maintain a reasonably designed system to oversee account activity, such as private securities transactions, to ensure compliance with securities laws and industry regulations. When a brokerage firm fails to sufficiently supervise its financial advisors or the investment account activity, it may be liable for investment losses sustained by customers.

If you have lost money with Michael Edward Magill or Foreside Fund Services, LLC, contact New York securities arbitration lawyer August Iorio of Iorio Altamirano LLP. August Iorio can be reached at august@ia-law.com or toll-free at (855) 430-4010 for a free and confidential review of your account.

Iorio Altamirano LLP is a boutique law firm located in the heart of New York City. Iorio Altamirano LLP represents investors nationwide who have suffered investment losses due to securities fraud.

INVESTIGATION: Kodak Stock Investment Losses

Published on: December 7, 2020 | by Iorio Altamirano

Iorio Altamirano LLP is investigating whether registered stockbrokers and financial advisors inappropriately recommended that customers purchase common stock of Eastman Kodak Company (KODK).

Iorio Altamirano LLP is an investor advocate law firm based in New York, NY. We help investors recover financial losses due to wrongful conduct by financial advisors and brokerage firms.

If you suffered financial losses from an investment in Kodak stock recommended to you or purchased on your behalf by a stockbroker or financial advisor, contact New York investor protection attorney August Iorio of Iorio Altamirano LLP. August Iorio, a native of Rochester, New York, can be reached at august@ia-law.com or toll-free at (855) 430-4010 for a free and confidential evaluation of your account.